I'm a CPA. I file a sch C. I think all of these are gifts and are not taxable, except #3 and then only if you take the free play.
Although there was a case where a high roller was given a car and it was ruled as taxable. I've heard more than once a taxpayer being told by an agent "I don't want to hear it" about comps. The law about being rebates on taxable items (gambling) being taxable is quite clear, though.
Posted by pede1976:Any chance you can send these questions off to Marissa or speak to how you specifically deal with them? I acknowledge that I am just asking for informational purposes, there is no engagement letter, there is no formal relationship between me and anyone else that offers advice, etc.
1. A casino gives me a $50 dining coupon via mailer - it has an expiration date. Is this taxable income when I use it?
2. A casino gives me a $50 dining coupon after I played for an hour - it has an expiration date. Is this taxable income when I use it?
3. I earn 1000 points at a casino and can use them to get $10 freeplay or $20 worth of food at the restaurant. Are either of these taxable income when I use them, and if spending my points on food is, do I say that was $20 (food value) or $10 (cash value) worth of income?
4. I earn 1000 points at a casino and can ONLY spend the points on gifts at the gift shop. Is this taxable?
5. I earned $50 in gas gift cards while playing (did not spend points on them), are these taxable?
In my mind, prior to reading the book, I would have thought that only 3 (both food & freeplay) was taxable, and 5 was taxable. However, after reading the book, especially when it says gifts are not taxable, I'm pretty strongly inclined to believe 5 is not taxable, and 3 may only be taxable if you take the freeplay.
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Posted by: Sam Phillips Beckerman <becksam@aol.com>
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